A leading company producing components for electric vehicles is cutting production amid a trade conflict. This was reported by Nikkei Asia, UNN writes.
Details
Leading Chinese automotive battery manufacturer SVOLT Energy Technology will close its European production sites and German subsidiaries starting in January 2025. An unspecified number of employees will be laid off.
The officially stated reason is that the cost of the projects is too high for the company, which is already experiencing a lack of funds.
However, the publication notes that the closure of SVOLT's business will be another example of Chinese companies reducing their operations in Europe amid an escalating trade conflict and falling sales.
Context
SVOLT, formerly part of Great Wall Motor, announced in 2019 the opening of its first foreign production base and research center in Europe. Investments in the project amounted to about €2 billion. Svolt planned to build two factories in Germany: a battery module and battery pack plant in Saarland and a cell plant in Brandenburg. The company intended to produce batteries with a total capacity of 24 gigawatt-hours at the European site. However, the construction of the plants was suspended.
Recall
The European Commission has introduced temporary countervailing duties on imports of battery electric vehicles from China ranging from 17.4% to 37.6%. At the same time, the new duties do not apply to hybrid cars, which allows Chinese automakers to continue selling partially electric hybrids in Europe at lower tariffs, although they face competition from European manufacturers in this segment.